Morning Meeting: Retail Risk From a Trump Trade War

Lorraine Hutchinson, a retail analyst, discusses the impact of Trump's victory on the retail sector, highlighting the optimism around tax breaks and the risks of a trade war. She explains how tariffs could affect retailers differently, with higher-end brands potentially passing costs to consumers, while lower-end brands may suffer margin declines. The discussion also covers inventory management challenges and opportunities for higher margins in the holiday season. Burlington Stores is identified as a promising investment due to its growth potential and ability to capitalize on holiday sales.

What is one of the major risks for the retail sector following Trump's victory?

• Lower taxes for businesses

• Higher wages for employees

• Increased consumer spending

• A potential trade war

How did retailers respond to the warm holiday season last year?

• By raising prices

• By offering significant discounts

• By increasing their inventory

• By expanding their product lines

What is the expected sales increase for the upcoming holiday season?

• 5%

• 3%

• 1%

• 10%

Which retailer is highlighted as having significant growth potential?

• Macy's

• Burlington Stores

• Nordstrom

• Target

What factor is contributing to Burlington Stores' potential for outsized earnings growth?

• Their high inventory levels

• Their focus on luxury goods

• Their ability to catch up on sales productivity and margins

• Their expansion into international markets